New Deal: Some Changes You Should Know About

Health insurance premiums

The first fundamental change relat to bahrain telephone number data the Polish Deal is the change in the health insurance contribution. If you are tax according to the scale, especially if you work full-time, then you will pay a 9% contribution and you can no longer duct this contribution from your tax. This increases your tax by almost 8%. The second change, this time beneficial, is that if you are tax according to the scale, you will benefit from new tax thresholds. The first threshold (i.e. the tax-free amount) is increas to PLN 30,000, and the second tax threshold is increasto PLN 120,000. This means that when tax according to the scale, you will pay a higher health insurance contribution, but at the same time you will pay a lower tax.

The basic change in the health insurance contribution in the Polish Deal is that you can no longer duct the health insurance contribution from your tax. In the case of people who run a business and are tax according to the scale, they pay 9%, while if they choose a flat tax, the health insurance contribution is 4.9%. In the case of flat-rate taxpayers, we have fix contributions, depending on the amount of income.

People employd under an employment contract, as well as people who work under a contract for services, will pay a health insurance contribution of 9%, which will not be dductible from tax (until 2021, a 9% contribution was also paid, but 7.75% of it could be dducte from tax). In the case of people who earn between PLN 5,700 and PLN 11,000 gross, the changes are to be compensatd by the so-calle middle class relief, so that these people do not feel negatively about the new regulations. It should be remembere that the middle class relief is calculatd on an annual basis and settld monthly.

end of the year you will get a refund.

An additional complication is the fact that the tax year is different from the year of calculating the health insurance contribution. The tax year runs from January 1 to December 31, and in the case of the health insurance contribution – from February 1 to January 31. If the health insurance contribution was overpaid in a given tax year, then at the end you can get a refund. The health insurance contribution is a percentage our clients have taken off in their campaigns. but there is also a certain minimum amount that must be paid. If in a given month the business activity was generating losses, then you still have to pay PLN 270 of health insurance contribution.

For flat-rate benefits, the health rate is:

• 60% of the average salary according to the Central Statistical Office with annual income not exceding PLN 60,000;
• 100% of the average salary according to the Central Statistical Office with annual revenues ranging from PLN 60,000 to PLN 300,000;
• 180% of the average salary according to the Central Statistical Office with annual revenues exceding PLN 300,000.

For taxpayers settling their taxes on a linear basis, the contribution will be 4.9% of income. At the same time, the health insurance contribution cannot be less than 9% of the minimum wage (PLN 270). People settling their taxes on a tax card pay PLN 270.

Comparison of load heights

The losers in this case are people who are employ full-time and earn a lot guinea lists as well as people who run large companies and are registe as sole proprietorships.

Health insurance contribution rate for flat-rate taxpayers

Another change in terms of novelties in health insurance contributions is the remuneration of board members. People who perform such functions under the act of appointment have not paid health insurance contributions so far, but now they must pay this health insurance contribution. However, the Polish Deal is full of holes and so-call optimization can be done. The first option is to oblige the partner to provide recurring non-cash benefits for remuneration. In this case, the health insurance contribution does not have to be paid. The second option is to appoint one of the partners as the general partner of the limit joint-stock partnership. However, with all such optimizations, it should be remember that, firstly, we incur costs relat to the creation of a new entity, and secondly, the costs of accounting services are much higher, and this is even when it comes to simple business activity.

Interest rates for different types of business

While the changes relat to health insurance contributions are not positive, when it comes to taxes, one can already try to qualify them as benefits of the Polish Deal. So let’s now go through the different types of interest rates on business.

Tax scale

The tax-free amount from 1 January 2022 is PLN 30,000, and the second tax threshold is PLN 120,000. However, there is one conclusion: we may pay lower tax, but we will also pay higher health insurance contributions.

Limit Liability Company

In this case, the basic rate is 19%. We also have a ruc CIT rate of 9%, which entrepreneurs can use:

• Small taxpayers whose gross sales revenue (together with the amount of value add tax due) did not exce EUR 2 million in the previous tax year, convert at the average euro exchange rate announc by the National Bank of Poland on the first working day of October of the previous tax year, roun to PLN 1,000, and at the same time those who pay dividend tax.
• Whose income other than capital gains achiev in the tax year did not exce the net amount of EUR 2 million, convert at the average euro exchange rate announcby the National Bank of Poland on the first business day of the given tax year, round to PLN 1,000 (usually this will be 2 January of the given year).